CZ/SK verze

Charting New Paths: How EU Nations Adapted to Facilitate Ukrainian Grain Exports Amidst Russian War

Charting New Paths: How EU Nations Adapted to Facilitate Ukrainian Grain Exports Amidst Russian War
photo: EPA / Public domain/Grain transportation
29 / 11 / 2023

With the beginning of Russia’s full-scale invasion of Ukraine on February 24, 2022, not only were human lives and the territorial integrity of Ukraine at risk, but also its export capacity. Nevertheless, Ukrainian Railways (Ukrzaliznytsia) came to the rescue.

At the beginning of the full-scale invasion, Sea ports located in the temporarily occupied territories, blocked by Russian troops, became unable to transport Ukrainian agricultural products. This created the threat of a food crisis in Europe and the rest of the world, as the monthly export of Ukrainian grains exceeded 5 million tons before the war. This situation put the already endangered country in an even more difficult position. In response, Ukrzaliznytsia announced its readiness to urgently reorganize the delivery of agricultural products to the borders of several European countries (Poland, Slovakia, Romania, and Hungary), its neighbors to the west and southwest. This drastically changed the percentage ratio of railway transportation: if before the war, only 11% of exports were carried out by rail, by March this percentage had risen to 41%. For comparison, as of February 24, 2022, sea ports accounted for 45% of Ukrainian exports.

Nevertheless, in attempting to ‘transfer’ exports to railways, Ukraine faced a new problem - the need to transload goods from its 1,520 mm broad gauge railway to the standard European 1,435 mm gauge at its western borders. This process often involves additional transloading to river barges and then to sea vessels, as seen in routes through Moldova and Romania that lead to the Danube River rather than directly to the sea. The war's outbreak has forced many dry ports at the EU-Ukraine border, primarily designed for bulk cargo like ores or coal, to adapt rapidly for large-scale grain transhipment. This adaptation has been critical as the existing infrastructure struggled to handle the sudden surge in grain volumes.

GMK Center / Public domain

The export routes for Ukrainian grain were adapting and expanding amid ongoing challenges. Traditionally, the primary paths have involved transit through Poland to Baltic Sea ports and Romania to Black Sea ports. However, the dynamic wartime scenario has necessitated exploring alternative avenues to ensure consistent grain exports, vital for Ukraine's economy and global food supply.

In those developments, Slovakia emerged as a potential key player. With its transhipment terminals initially focused on bulk cargo like ores and metals, the region is adapting to facilitate grain shipments. The Košice transloading terminal, for instance, boasts a significant monthly capacity and is developing infrastructure to expedite the process. ZSSK CARGO, a major Slovakian transporter, has shifted its focus significantly towards grain, aiming to transport 1 million tonnes in 2023, up from 69,000 tonnes in 2021.

Hungary, too, asserted its role within the EU Solidarity Lanes, aiming to boost its capabilities at the Záhony -Eperjeske hub. Moldova's railways were also witnessing a revival, catering to the heightened demand for grain transport. The country announced enhancing its railway infrastructure, with Ukrzaliznytsia aiding in the refurbishment of key rail sections to facilitate smoother grain transport. Amid these developments, a new Croatian route was announced in September 2023. This alternative pathway envisages transporting grain via Danube river barges to Croatian ports like Vucovar, followed by rail transit to maritime ports. 

With the increase in grain export volumes, however, several countries in the region have taken steps to manage the influx. Poland, Bulgaria, Hungary, Slovakia, and Romania, recognizing the disruptive impact of cheap Ukrainian grain on their markets, have implemented a ban on its sale within their borders while facilitating its transit to ports for global export. This move, though controversial, aims to balance support for Ukraine's economy with protecting local agricultural sectors. Meanwhile, Ukrainian Railways, grappling with dropping performance, plans a 20% tariff increase in 2024 to align with European models, a decision that has drawn criticism from various sectors.